Oppo Mobile India Private Limited Vs Union Of India And 3 Others (Allahabad High Court)
The Allahabad High Court considered a writ petition challenging the validity of Section 15(3)(b) of the Central Goods and Services Tax (CGST) Act. The petitioner argued that trade discounts arising from an original agreement but computed after the supply should not affect the determination of transaction value for GST purposes. Reliance was placed on earlier Supreme Court judgments, including Deputy Commissioner of Sales Tax (Law) Board of Revenue (Taxes) Ernakulam v. Advani Oerlikon (P.) Ltd. and Southern Motors v. State of Karnataka. It was contended that under earlier tax regimes, such discounts arising from pre-existing agreements did not create any disability for suppliers in determining transaction value or the amount receivable for supplies made under those agreements. According to the petitioner, a legislative provision taking a different view may not withstand scrutiny in light of these precedents.
It was also submitted that the provision under challenge is proposed to be deleted by the legislature following a recommendation of the GST Council, as reflected in the Finance Bill, 2026. Additionally, the petitioner raised objections regarding the invocation of Section 74 of the CGST Act in the case. The petitioner further submitted that 10 percent of the disputed tax amount may already have been deposited. After hearing the parties, the High Court observed that the challenge to the validity of the provision raised issues requiring deeper examination and therefore issued notice to the Attorney General of India. The court also granted interim protection to the petitioner, directing that no further recovery shall be made during the pendency of the writ petition, subject to deposit of 10 percent of the disputed tax amount, including any amount already deposited or recovered.
